Wednesday, June 9, 2010

Economic policy has not kept up with the science of motivation and happiness.

After viewing this, it makes perfect sense that paying volunteers reduces their volunteerism. On top of it, when you learn that our dissatisfaction and subsequent desire for more money is based on how much money our peers have, or that even high school popularity (a notoriously fickle business) has a demonstrable effect on our financial success, it sort of makes you want to ensure our economic system relies a little less on free market incentives in which we're susceptible to all sorts of cognitive biases and environmental factors. At least one of those biases – in this case, committing to a situation with sunken costs – diminish with age.

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